life insurance

debtinfo

MicheH wrote: »

really Debtinfo? I wish i'd spoken to you earlier. I've been so worried about funeral costs. Thank you

Yep, its amazing whats in the OR's technical manual if you have a spare 6 months to read it

54.35 Payment of funeral expenses
The reasonable funeral and testamentary expenses of the deceased debtor have priority over the preferential debts listed in Schedule 6 [note 2]. This includes where a debtor dies after the bankruptcy order is made. If the personal representative of the deceased debtor does not notify the trustee of the funeral expenses before a final dividend is declared, the trustee may declare and distribute the dividend without regard to the claim of the personal representative in respect of reasonable funeral and testamentary expenses [note 3].
54.36 Payment of funeral expenses where debtor dies after the case is closed
In some cases an asset such as an insurance policy that vests in the trustee may become payable on the death of a bankrupt. This may happen some time after the trustee has closed the case and obtained his/her release as trustee. The personal representative may also make a claim in respect of funeral expenses against the amount received by the official receiver as trustee ex officio. The official receiver should charge his/her usual realisation fees and also hold back an amount equal to any debit balance written off on the insolvency estate before making a payment in respect of funeral expenses in such circumstances.

philnicandamy

6? speed reader eh?

Paul_the_Painter

My understanding is that most (if not all) death benefits from employers are exept from the clutches of the OR. The reason being that they are almost always written in trust. When you fill out the form at work you will notice that they say something along the lines of "expression of wish" rather than "nominated benificiary"

What this means is that ultimatley it is up to the Trustees of the scheme who, or if, they pay out. Now in practice they will always pay out, but they may change who they pay out to. If for example you have nominted your partner, but they are an undischarged bankrupt, the Trustees may choose to pay the benefit to the children:- this means the OR doesn't get a penny.

If you are BR and you die, there is no contract between you/your estate and the company for the cash payout, so the Trustees are free to give it to whoever you have expressed a wish to.

It's not going to cover everything, but it's good to know that at least the payout from your employer is safe - probably

debtinfo

yes that can happen for death benefit, it all depends on whether the the amount is paid to a trust, a nominated person or to the employees estate. I have in the past had cases where it paid out to the estate and has been taken by the OR. Needless to say the wife was not best pleased

Paul_the_Painter

It must be especially galling to the owners of the business as well, they would have set up the scheme to benefit their employees families in the worst of circumstances. Possibly as the result of a hasty, ill thought out decision made many years ago, they did not opt to act as Trustees, but made it a contractual obligation instead - hence the OR gets the cash.

People are funny though, at a previous place of work some staff were thinking it was all a con, and the bosses were just trying it on. When in fact they had thought carefully about it. My mothers firm - a very large well repected retailer - had a number of cases where they paid out to a different person due to a change in circumstances that made the expression of wish - made many years ago - suspect.